As this report was being prepared, no one could have predicted the context in which we are releasing it. California is the center of oil refining in the western U.S., with nearly 50% of its refining capacity in the five closely spaced oil refineries of Contra Costa and Solano counties. As the U.S. attempts, under failed federal leadership, to recover from the COVID-19 crisis, the International Energy Agency reports that any economic recovery that fails to step up to the urgency of addressing climate change will make it impossible to prevent climate catastrophe.
“Starting [a phase-down] sooner allows state climate targets to be met by cutting oil use more gradually, which makes transitions that protect workers and communities possible and climate goals feasible,” said Greg Karras, who authored the report for CBE.
Here are the report’s major conclusions and calls for action:
All paths to a livable climate involve refining much less oil.
Steep reductions in petroleum are necessary to meet our health goals.
Early action to decommission refining capacity is a critical component of the least-impact, most socially just, most feasible path to climate stabilization in California.
A planned, gradual phase-down gives us the time to develop sustainable alternatives for workers and communities economically dependent on oil.
Actions that limit refining in California can cut emissions across the petroleum fuel chain.
We must pair gradual reduction of refinery output with aggressive measures to insure clean mobility for all people.
Facilities such as refineries are major local emission centers for toxic co-pollutants alongside greenhouse gases, especially fine-sized particulate matter or soot (PM2.5). “From Richmond to Wilmington black and brown communities are on the frontlines of a toxic relationship with oil. This is a blueprint for organizing just transitions out of it,” said Andrés Soto, Richmond Organizer at CBE.
A path of gradual reductions, approximately 4-7% of refining capacity per year, will not even immediately affect California oil consumption. Californians already use significantly less refined fuels than produced by the refineries; refinery exports have grown to nearly a third of capacity. “Refineries around here pollute our communities even more by refining more oil to sell even more of their polluting fuels somewhere else, like black lives are invisible” said LaDonna Williams, a community leader who lives in South Vallejo.
A critical component of the report is addressing the challenges of transitioning workers and communities that are financially dependent upon the fossil fuel industry. Steve Garey, a retired oil refinery worker, former United Steel Workers union official and leader in the Blue-Green Alliance, spoke passionately about bringing workers and communities together to build a new economy.
Toxic Relationship – How refineries affect climate change and racial and economic injustice
East Bay Express, by Jean Tepperman, July 22, 2020
BURNT: California is the biggest oil-refining center in Western North America according to Greg Karras of Communities for a Better Environment. STOCK PHOTO
California should begin gradually reducing output from its oil refineries in order to avoid climate catastrophe and to make the transition to clean energy as equitable as possible. That’s the conclusion of a major new report released July 6 by Communities for a Better Environment (CBE), endorsed by more than 40 environmental and social justice organizations.
While most people agree on the need to use less fossil fuel, many fear that requiring refineries to reduce production could lead to higher gasoline prices and a big economic hit for workers and communities that depend on refineries for income. Report-author Greg Karras responded, “If we start now, doing it gradually, it will give us the time to replace refinery-dependent economics.” The report calls for cutting production 4 to 7 percent a year, starting in 2021.
California has set targets for cutting carbon emissions between now and 2050: the state’s share of global cuts needed to keep temperature increases below catastrophic levels. Because the carbon that causes climate change builds up in the atmosphere, California has a carbon “budget”—the total amount it can emit from now until 2050. According to Decommissioning California Refineries, California will have to refine much less oil per year to avoid blowing through this carbon “budget” by about 2037.
“California is the biggest oil-refining center in Western North America,” Karras said. “Oil refined here emits more carbon than all other activities in the state combined.” Even if all other sources of carbon are reduced on schedule, Karras said, “we must refine much less oil if we hope to meet the state’s carbon limit.”
“We have to break free from our toxic relationship with oil before it takes us over a cliff,” Karras said. “When you’re in a car heading toward a cliff, it matters when you start putting on the brakes.”
The sooner we start, the more likely we are to escape the worst impacts of climate change.
The issue is not just climate, said Andres Soto of CBE. He pointed out that refinery pollution is concentrated in communities like Richmond, centers of racial and economic injustice.
“Only 20 percent of Richmond is Euro-American,” he said.
And the health consequences of having a refinery as a neighbor are severe.
Rodeo, another Contra Costa refinery town, “is in the 98th percentile for asthma,” said resident Maureen Brennan, and it has high rates of skin disease, autoimmune disease and cancer—all linked to refinery-generated pollution.
Retired refinery worker Steve Garey, past president of a United Steelworkers local in Washington state, said starting now to plan for reduced refinery production could actually benefit refinery workers, since “the movement away from fossil fuels and toward renewables is going to accelerate. It’s an economic reality. Renewables are cheaper than fossil fuel and getting cheaper all the time.”
Recently when the pandemic cut demand for gasoline, Garey said, the Marathon refinery in Martinez shut down, leaving the workers and community stranded.
The current drop in oil use, Karras said, gives us a once-in-a-lifetime opportunity to turn away from the cliff and build a cleaner and more equitable recovery.
Prices and Jobs
The Western States Petroleum Association (WSPA) said in a statement that requiring cuts in refinery production is a bad idea: “We believe we can support our people, our communities, our planet, and our shared prosperity without having to sacrifice one at the expense of the other. However, arbitrarily working to limit refining or production in the state will leave many Californians short of energy, without work and at a greater risk for displacement.”
The California State Building Trades Council recently joined in a partnership with WSPA to protect petroleum-industry jobs, although council President Robbie Hunter said he agrees that “dropping output in refineries is necessary. I believe we need to get rid of fossil fuels.” His unions have often lobbied for clean-energy programs like the Renewable Portfolio Standard, which requires electricity providers to use an increasing percentage of renewable energy.
But, like WSPA, Hunter opposes refinery production cuts, fearing an increase in gasoline prices that would, among other things, hurt building-trades workers such as his sons, who “sometimes drive 80 miles a day to job sites.” He argued for relying instead on programs to cut demand. “If the need goes down, I’m 100 percent in,” he said.
Contra Costa County Supervisor John Gioia represents a district that includes the Richmond Chevron refinery. He also sits on the California Air Resources Board (CARB) and the Bay Area Air Quality Management District. A longtime environmental champion, Gioia said he agrees with the report’s authors that “both demand and supply side strategies are necessary” to reduce petroleum use fast enough to meet climate goals. Last year the state legislature authorized studies to come up with strategies to reduce both supply and demand for greenhouse-gas-producing energy.
Gioia pointed to several new CARB regulations to reduce petroleum use, including a recent first-in-the-nation rule that sets a schedule for replacing diesel with electric trucks, as well as a schedule passed last year for switching to electric buses. But he said, “we have to be really thoughtful about the impact [of climate measures] on the hardest-hit communities. It’s the lowest-income Californians, communities of color, who are the most impacted by rising fuel costs and don’t always have access to public transportation.”
Karras responded to these concerns by pointing out that, as demand for petroleum products in California has fallen, refineries have not reduced their output but, instead, started exporting more of their product—now at least 20 percent and rising. So production could be cut by 20 percent or more without reducing the amount available to Californians. And, he added, “It’s a pure injustice for Black and Brown people in fence-line communities” to suffer pollution “so refineries can manufacture fuel that Californians don’t need, to export our oil dependency to other countries.”
Union leaders don’t buy that argument.
“As long as there’s a market for the product somewhere, American workers should produce it,” Garey said. For members of his union, cuts in refinery production mean “losing the best job they ever had.” In addition, many workers in construction trades depend on refineries for jobs. And, Garey said, “this is a community-wide issue.”
Refineries contribute a big share of the taxes communities rely on. And there’s what economists call a “multiplier” effect: every high-paying job creates seven to 10 other jobs providing the goods and services that refinery workers can afford to buy.
Start Planning Now
According to the Decommissioning California Refineries report, those very economic facts are the reason why it’s important to start immediately creating ambitious programs for supporting workers and communities in the switch to a clean-energy economy.
Doing that “will take state, local, and county action as well as a national plan,” said Soto of CBE. And, he added, the plan must be based on “justice for workers and the people who have paid the heaviest price of having polluters in their communities.”
Carol Zabin, who heads the Green Economy Program at the UC Labor Center, agreed. It will be necessary to “use a lot of levers of government, from direct public investment to business incentives to training and education infrastructure,” she said.
Ramping up efforts to create good jobs in a clean-energy economy is a goal environmentalists and labor advocates agree on.
“The big problem is that there are not enough other good jobs for people without a college education,” Zabin said.
Hunter, of the Building Trades Council, said his unions have been pushing for public programs that create good jobs while reducing demand for petroleum: building solar and wind energy, massive expansion and electrification of public transit, high-speed rail, housing near transit.
Zabin agreed with Karras that each community needs to “figure out in an intimate local setting” how to shift from economic dependence on refineries. “We have to plan locally with state and federal support,” Karras said.
“This is a process that requires community-wide participation,” Soto added. Workers, refinery community residents, and environmental organizations should be involved in the planning, Garey said. They all “need each other as allies – we need the biggest ‘we’ we can get.”
Supervisor Gioia said Contra Costa County should “start now having study sessions and community forums to lay out pathways for this thing that we have to do to save the planet.” He agreed that workers and residents should be part of the planning process and reported that Contra Costa has already adopted “a policy to have a more inclusive planning process—the community has to have a voice.”
“We need strategies to make California the manufacturing center of the new economy,” Gioia added. He pointed to a new factory in Los Angeles County—with good, union jobs—making the electric buses needed for the county’s clean-transportation plan.
But not all investments in clean energy produce good, family-supporting jobs, Zabin said. “We need labor standards on all industries affected by climate policy.” There are none, she pointed out, in California’s program for building electric-vehicle charging stations. And most energy-efficiency projects “have gone low-road.”
When the Air Resources Board was creating standards for energy-efficiency work, she said, the State Building Trades Council pushed for them to include labor standards. Zabin herself submitted two reports calling for the same thing. For environmental programs to build a coalition with labor, she said, “we should put conditions on the $1.5 billion a year we spend on energy efficiency.” But CARB rejected these proposals. “It’s a question of political will,” Zabin said. Government could also create good jobs in other areas, she added, such as rebuilding infrastructure—a green New Deal.
Committing Significant Revenue
But economic development programs are not enough to meet the needs of refinery workers, Garey said. “We need to commit significant revenue, enough to support their income for an appropriate time.” He pointed to a program spelled out in an initiative that narrowly lost in his state of Washington, calling for “income insurance” for up to five years for workers who lost their jobs because of the switch from fossil fuel, as well as health insurance, a path to retirement and support for job retraining.
Building a stronger “social safety net” is necessary, not only for displaced petroleum workers, but for everyone, Karras argues: “The average gig-worker job doesn’t pay enough for rent or mortgage, health care, college.”
Especially in refinery communities like Contra Costa, Gioia said, “we need to look at more robust training programs in our community colleges—opportunities for a new generation to enter trades in a new industry.” At the same time, he added, it might be necessary to “subsidize early retirement for workers late in their career.”
The nonprofit think tank Oil Change International calls for a similar inclusive planning process on the state level, a “Statewide Just Transition Task Force—as has been done in Scotland and in Canada, for example—to facilitate the process of social dialogue and planning between employers, workers, unions, frontline communities and organizations, and local and state agencies.” [The Sky’s the Limit California, p. 10]
Calls for these ambitious programs raise the obvious question of where the money will come from. Oil Change International says the state should charge oil companies a “just transition fee based on the value of their oil production.” Karras suggests a similar principle, which could also be applied on a local or state level: “Make the polluters pay.” He pointed to a federal program that required nuclear power plants to “pay up front into a trust fund to clean up the whole mess—environmental and economic” that they would leave behind when they close.
The important thing—the reason for issuing this report—Karras said, is to “start the conversation. To say, ‘we have to do this,’ and start talking about it. We will have to figure out how.”
BayNature.org, by David Loeb, April 16, 2020
The Phillips 66 San Francisco Refinery in Rodeo. (Photo By Dreamyshade, Wikimedia CC BY-SA 4.0)
Drive east along Interstate 80, past the Phillips 66 refinery in Rodeo, and you can see that the Bay Area remains very much embedded in the fossil fuel economy. And if the U.S. Army Corps of Engineers has its way, we may well be doubling down on that relationship.
The Corps has a pending proposal, officially dubbed the “San Francisco Bay to Stockton, California Navigation Study,” to dredge a 13-mile stretch of the San Francisco Bay Estuary from San Pablo Bay (just north of Point San Pablo) through the Carquinez Strait to the Benicia-Martinez Bridge. This project would deepen the channel leading to four oil refineries along the shoreline by an average of three feet, allowing for the arrival of a larger class of oil tankers than can currently access these refineries. The Army Corps’ January 2020 Environment Impact Statement (EIS) for the project claims that the total volume of oil shipped will not necessarily increase as a result of the project, but rather claims that the dredging might even result in reduced ship traffic in the Bay by delivering the same amount of oil on fewer (but larger) ships.
A map of a proposed new San Francisco Bay dredge from the Army Corps of Engineers’ January 2020 environmental impact statement.
This argument has not persuaded Bay Area environmental groups, who last spring submitted comments on the Draft EIS opposing the dredging project. These groups, including San Francisco Baykeeper, Sierra Club, Center for Biological Diversity, Friends of the Earth, Communities for a Better Environment, and Ocean Conservation Research, are submitting similarly negative comments on the Final EIS, which they say is not much of an improvement over the 2019 draft version. The deadline for public comments has been extended, due to the Covid-19 pandemic, until Tuesday, April 21.
The concerns of these organizations fall in to three basic categories: direct impacts on the local aquatic environment from both the dredging itself and from the increased traffic; direct air quality impacts on local communities from the increase in refinery operations; and above all, concern that increasing the capacity for delivery and production of fossil fuels directly contradicts the state’s mandated goal of reducing greenhouse gas emissions to slow the impact of climate change.
I. Impacts on Local Aquatic Environment
The Army Corps’ EIS contends that the Bay floor sediments to be disturbed by the dredging do not contain significant levels of toxic materials. But comments by the environmental organizations point out that the Corps appears to be relying on studies done over a decade ago or more, and they list a range of contaminants that could be re-suspended from the settled sediment that are not addressed by the Corps. The groups point out that this narrow body of water connecting the Bay with the Delta is heavily used by endangered fish species, including Delta smelt, longfin smelt, and Chinook salmon, among others, as well as by harbor seals and California sea lion, both protected marine mammal species.
The groups also point out that the EIS only addresses the impact of the dredging itself on the local aquatic environment. By asserting that the deepening of the channel will not, on its own, increase the level of shipping in the channel, the Corps disclaims any responsibility to address the impact of increased oil tanker traffic. However, as the environmental organizations point out, there is little chance that the refineries would not take advantage of this opportunity to increase their operations. In fact, as Ocean Conservation Research points out in its comments, the Phillips 66 refinery in Rodeo has recently been granted permission by the Bay Area Air Quality Management District to double its refining capacity. So it would be naïve to ignore the probability of increased traffic in the Strait, with is attendant increase in disturbance of all kinds (noise, water pollution, possible spills, etc.) and the resulting impact on wildlife populations.
In addition, Ocean Conservation Research’s comment letter points out that in order to accommodate the larger ships of the Panamax class (so-called because they are the maximum size allowed through the Panama Canal), the Phillips refinery has proposed an enlargement and expansion of its wharf facility. Such a project would involve disturbance of sediments full of toxic heavy metals left behind by the Selby Slag, a company that operated a smelter there into the 1970s, extracting ore from waste metals. Because the wharf expansion is considered a separate project, the Corps is not legally required to address it in its EIS — but expansion of the wharf would not be economically viable without the deeper channel.
Additionally, according to Baykeeper Executive Director Sejal Choksi-Chugh, “Baykeeper has concerns about how the project will impact salinity in the Delta. Deepening the shipping channel will push the fresh water/salt water mixing zone (known as the X2) further east, threatening drinking water supplies” for people in Contra Costa County and other Delta communities.
II. Impacts on Local Communities
Again, by asserting that the dredging project will not result in increased refining activity, and therefore only considering the impact of the actual dredging work, the Corps’ EIS does not find any impact on surrounding “environmental justice communities.” These communities, including Richmond, Vallejo, and Martinez, have been subjected to high levels of pollution from decades of industrial activity, and are demographically “majority minority” and low income. The failure of the EIS to contemplate increased levels of air pollution from increased refinery activities belies the refineries’ long record of “accidental” spills, flares, releases, etc. that have caused the area’s residents to periodically “shelter in place” long before the novel coronavirus.
III. The Big Picture
All of these local negative impacts are bad enough. But in their comments, the environmental groups assert that it is essential to step back and look at the much larger picture of what the dredging project implies for the region, the state, and the planet:
“The proposed channel alterations would remove constraints on expanding fossil fuel import and export volumes … The project will likely result in a significant increase in future volumes of crude oil and refined petroleum products shipped through the Bay … Here, the increased volume of oil and coal passing through the deepened channels will lead to greater refining and export activity. These in turn will lead to more greenhouse gas emissions, both at the refineries and when the products are combusted. Stated differently, the dredging is ‘a mere step in furtherance of many other steps in the overall development’ of the area’s fossil fuel industry.”
The environmental groups believe that the ultimate plan of the oil companies is to have the Bay Area’s refineries serve as an outlet for oil extracted from the Alberta tar sands, one of the most carbon intensive fuel sources on the planet, given the energy that must be invested to extract it, liquefy it for transport, and ship it. Moreover, the transport of this oil from its source in northern Alberta to the Bay Area is highly problematic, both politically and environmentally. It involves expansion of the controversial Trans Mountain pipeline over First Nation lands of the Salish people in Canada (a project that they are resisting both in the courts and on their land). Then the unrefined oil must be transported by tankers through the Salish Sea, threatening the already depleted Southern Resident population of killer whales. And finally, the tankers must pass through the Golden Gate, where recovering populations of humpback whales and gray whales are also facing increased threats from ship strikes in this busy shipping channel.
All of this leads to the final question of why U.S. taxpayers should fund (at an estimated initial cost of $57 million) a project whose main intended beneficiaries are privately owned oil refineries. Of course, direct taxpayer subsidies to the fossil fuel industry are nothing new, but in an era when we climate change requires us to be reducing our dependence on carbon-intensive fossil fuels, this project would appear to be moving us in the opposite direction.
About the Author
David Loeb
From 2001-2017, David Loeb served as editor and then publisher of Bay Nature magazine, and executive director of the nonprofit Bay Nature Institute. A Bay Area resident since 1973, David moved here after graduating from college in Boston. The decision was largely based on a week spent visiting friends in San Francisco the previous January, which had included a memorable day at Point Reyes National Seashore. In the late 1990s, after many years working for the Guatemala News and Information Bureau in Oakland, David had the opportunity to spend more time hiking and exploring the parks and open spaces of the Bay Area. Increasingly curious about what he was seeing, he began reading natural history books, attending naturalist-led hikes and natural history courses and lectures, and volunteering for several local conservation organizations.
This was rewarding, but he began to feel that the rich natural diversity of the Bay Area deserved a special venue and a dedicated voice for the whole region, to supplement the many publications devoted to one particular place or issue. That’s when the germ of Bay Nature magazine began to take shape. In February 1997, David contacted Malcolm Margolin, publisher of Heyday Books and News from Native California, with the idea of a magazine focused on nature in the Bay Area, and was delighted with Malcolm’s enthusiastic response. Over the course of many discussions with Malcolm, publishing professionals, potential funders, and local conservation and advocacy groups, the magazine gradually took shape and was launched in January 2001. It is still going strong, with a wider base of support than ever.
Now retired, David contributes to his Bay Nature column “Field Reports.”
Refinery Town Says No to Valero’s Oil-by-Rail Plan
By Matthew Renda, Friday, September 23, 2016 5:14 PM PT
Courthouse News Service
BENICIA, Calif. (CN) — The City Council of a small city of 27,000 in California’s San Francisco Bay Area made a decision this week that may have huge ramifications for the nation’s energy infrastructure.
The five-person Benicia City Council voted unanimously to reject the Valero Crude Oil by Rail Project — a substantial setback for an oil and gas industry that operates several refineries nearby and setting an interesting precedent for local government’s assertion of jurisdiction over oil and gas routes.
The Valero Crude Oil by Rail Project would have allowed the oil company, which operates a large refinery in Benicia, to bring in crude oil by rail rather than exclusively by ship as the current arrangement dictates.
However, Benicia City Council ended a divisive community fight over the issue by finding the project is too dangerous for the community. The potential for contamination of the Sulphur Springs Creek and other watersheds in the event of a derailment proved too much for the council members to brook.
“I have seen stories piled on top of the other about what wasn’t working and what is particularly troubling is the lack of financial resources provided in the case of a catastrophic event,” Mayor Elizabeth Patterson said during deliberation on Wednesday night. “The money comes in too late, people have to go out of business and people have to move away.”
Leading up to the decision, several questions about whether the City Council even had jurisdiction hovered over the matter, with project proponents asserting that the federal government regulates rail and any decision made by the city government is preempted.
However, the Surface Transportation Board wrote the city on Wednesday before the meeting saying while the federal government does regulate interstate commerce and the railroad, the proposed $70 million rail depot was within the regulatory purview of the city.
While many local residents applauded the decision, environmental groups talked about its reverberations.
“This is a victory for the right of communities to say no to refineries’ dangerous oil train projects,” Ethan Buckner with the group Stand — formerly ForestEthics — said. “The federal government has said once and for all that there is nothing in federal law that prevents cities from denying these oil companies’ dangerous rail projects.”
In the series of meetings leading up to the decision, Valero touted its safety record and said the train project carried minimal risk and would bring jobs and economic activity to the region.
“After nearly four years of review and analysis by independent experts and the city, we are disappointed that the City Council members have chosen to reject the crude by rail project,” Valero said in a statement. “At this time we are considering our options moving forward.”
Valero is the largest employer in the city, according to a recent comprehensive financial report compiled by the city’s finance team.
However, Patterson said the city’s general plan calls for a more diversified economy that relies heavily on small businesses, many of which would be hampered by the crude oil by rail project, particularly if something went wrong.
“We have to be less dependent on the refinery as we pivot into an era of attracting different kinds of businesses,” she said.
In 2014, trains transporting crude oil spilled about 57,000 gallons of the environmentally hazardous substance, more than any other year since the Pipeline and Hazardous Materials Safety Administration began keeping track in 1975.
The Columbia River, one of America’s most scenic rivers as it carves out the border between Oregon and Washington state, was spoiled by 42,000 gallons of oil when a train derailed due to a defective bolt on the track.
While many celebrated the possibly precedent-setting decision undertaken by the small city body, Councilman Mark Hughes resigned himself to certain litigation and its associated expense.
“Regardless of the decision tonight, I believe a lawsuit will be filed,” Hughes said.
So whether Benicia’s decision will be the first in an onslaught of local entities attempting to regulate elements of the oil and gas industry out of their communities or whether that will be left to federal and state authorities may be a matter for the courts to decide.
There are five major refineries in the Bay Area including the Valero refinery in Benicia: Chevron in Richmond, Tesoro outside of Concord, Phillips 66 in Rodeo and Shell in Martinez also operate and contribute significantly to both the local economy and air pollution.
The five refineries process about 800,000 barrels of crude oil per day and along with other oil and gas companies generate about $4.3 billion in local tax revenue, according to a 2014 study performed by Los Angeles County Economic Development Corporation and commissioned by the Western States Petroleum Association.
But Ralph Borrmann, public information officer for the Bay Area Air Quality Management District, told Courthouse News recently that the refineries are responsible for anywhere from 4 to 41 percent of the pollutants in the area, depending on which pollutant is identified.
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